The current environment is playing to the strengths of special situation hedge fund strategies, which seek to generate alpha from announced deals, and as merger spreads widen out, new opportunities are arising.

With notable dispersion in high yield in 2019, CQS and BlueBay Asset Management see further upside as energy and automotive sectors respond to technology disruption…

Tullow Oil, the London-listed oil and gas explorer shorted by several major hedge funds, has seen a further slump in its share price this week.

Hedge funds are continuing to bet against Europe’s travel industry, with several brand-name managers growing their shorts in travel staples such as easyJet and TUI, amid concerns the fallout from the coronavirus (Covid-19) outbreak could impact the continent’s tourism sector.

Metronome Capital, the London-based long/short equity manager led by former Lehman Brothers banker and Parvus Asset Management partner Sharif el Khazen, is flying high – powered by a mix of long conviction trades in European luxury brand names and a cluster of short bets on assorted declining sectors.

Traditionally, allocators and investors often eschewed smaller, specialist hedge funds in favour of the firepower offered by larger brand-name managers. But as many smaller funds have posted outsized gains in recent years – while well-established marquee names experienced decidedly mixed performances – many at the forefront of the industry are detecting a potentially decisive shift in investor sentiment. 

Last year provided some optimism for global macro hedge funds, ending the year up 6.50 per cent according to eVestment’s aggregated hedge fund performance data. And there are signs that 2020 could offer good opportunities to make upside, as macro traders position themselves for higher inflation in Europe and investor rotation out of US equities.

Now entering its sixth year of operation, ProMeritum Investment Management – a London-based discretionary emerging markets fixed income-focused manager – has notched up five successive years of positive returns since launching in January 2015. 

Evallon Global Investment, a New York and Hong Kong-based asset manager and alternative investment solutions provider, is making its alternative investment offering available for qualified investors from January 2020 onwards. 

Pictet Asset Management, the investment management arm of the Geneva-headquartered wealth management giant Pictet Group, is warning against complacency in global markets amid easing US-China trade tensions and reopened negotiations over the UK’s withdrawal from the EU.